Normandy wants to lure 'hot entrepreneurs' worried about Brexit

Britain and the European Union will start talks this week on their future trade relationship after Brexit. As Ciara Lee reports, with no substantial progress on the Irish border conundrum, negotiations could be challenging.
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A bus covered with an ad, commissioned by the Normandy development agency, urging entrepreneurs to open offices or production sites in Normandy, sits parked outside the Bristol Chambers of Commerce in Bristol, U.K., on March 19, 2018.(Photo: James Beck, Bloomberg via Getty Images)

PARIS — France's Normandy region is famous for the D-Day landings and Camembert cheese, but now it longs for another kind of invasion: British entrepreneurs escaping Brexit.

The Normandy development agency, AD Normandie, launched a charm offensive in March to urge British business owners to “vote with their feet,” cross the English Channel into France and the European Union — and leave their Brexit fears behind.

British voters approved a historic referendum two years ago to separate from the EU, which is slated to happen by March 2019. The United Kingdom's future relationship with the EU is still unclear, as negotiations continue. As a result, many British executives worry that customs, immigration and regulatory barriers could disrupt their business with the 27 other EU nations.

In response, France and many EU countries are rolling out the red carpet.

"You will find the process as smooth as their Camembert ... or their oysters for that matter," said one ad plastered on a double-decker bus that AD Normandie hired to tour London and other British towns. The bus parodied the pro-Brexit buses that were part of the Vote Leave campaign.

A tongue-in-cheek personal ad in a mock newspaper called the Normandy Times ran in British papers — seeking a “hot entrepreneur” who “must have an appetite for business, beautiful coastal walks and long sun-drenched lunches with wine flowing.”

Transport for London, which manages the Tube and other mass transit, rejected using the ad in its stations and vehicles, calling it “controversial.”

About 30 small- to medium-sized British companies have requested meetings to discuss setting up business in France, said Alexandre Wahl, who heads AD Normandie.

“A week after the campaign ended, three of them came to Normandy to see what could be possible,” Wahl said. “These companies don’t know what will happen with Brexit, but they are aware things won’t be the same.”

Companies that rely heavily on the EU market — such as the automotive, aerospace and high-tech industries — worry they won’t be able to secure components or hire foreign talent once Britain leaves the EU.

Some businesses are considering alternative headquarters in the EU. For example, the British budget airline easyJet set up a subsidiary in Austria last year so it can operate flights between EU countries after Brexit.

Such moves could continue, although many British businesses are adopting a “wait-and-see” approach until a final deal is reached between Britain and the EU.

“This is part of a long game,” said Alasdair Darroch of Altios UK, a firm that advises companies on international business development. “No doubt in 10 years time, there will be more divergence in the relationship between the U.K. and Europe. It’s going to be important for some companies to have a base in Europe where they can keep trading without complications."

To entice British businesses, Normandy has set up a special zone offering tax breaks and grants up to $123,000 to foreign companies that decamp to France. There are also incentives for families to resettle in the area, which is already the home of 8,500 British expatriates because of its proximity to both southern England and Paris.

This special economic area — the first in France — will be key to attract foreign businesses, said Hervé Morin, president of the Normandy regional council. “It’s very well placed because it’s close to the industrial port of Le Havre."

Normandy’s sweet talk follows similar moves by Paris and other European capitals to lure banking giants based in London’s financial district.

Shortly after the Brexit referendum passed in June 2016, Paris' La Defense business district plastered billboards at London's Heathrow airport and the London stop for Eurostar trains with the irreverent slogan: “Tired of the fog? Try the Frogs!”

The moves come as French President Emmanuel Macron, a former investment banker, wants to capitalize on Brexit woes to attract foreign investments and shake France’s reputation as being unfriendly to business because of high taxes and maddening bureaucracy.

Central to Marcon’s vision is to beef up France's financial sector, which is tiny compared to London. No big banks have left London so far, but large American and British banks have proposed expanding their offices in France as Brexit approaches.